To contain the outbreak of COVID-19 in the US, numerous states and local governments have temporarily closed nonessential businesses and issued “stay-at-home” orders, creating a historic disruption to the US workforce. Unlike most major disasters that affect only a segment of the US population, the adverse effects of COVID-19 are nationwide (and global). In response to COVID-19’s impact on US businesses and its employees, federal legislation was enacted to extend paid leave to certain employees, expand unemployment insurance (UI) benefits and provide cash flow to employers through tax credits, tax payment deferrals and forgivable loans.
Some states and localities have also responded by expanding their paid leave mandates, waiving certain reporting requirements and providing extensions on the due date of payroll tax returns, tax payments or both. COVID-19 has also dramatically increased the number of employees working from home, an arrangement that is new for many employers. Telecommuting raises numerous questions, from the tax treatment of equipment and supplies to the payroll tax rules that apply.
For more information, download the report and visit our Employment Tax Advisory Services page.